Shipwright Archive
Thread: For those having trouble deciding on a price
Wovram wrote:
I can sell my steel for 10cpu easy probably higher yet people moan if i charge that rate in a chassis or component. Clearly steel looses its lustre when exp has been extracted. So I currently sell at 3cpu-5cpu max unless its labor intensive.
Ok this you need not stand for. If they moan and grone you /slap them and tell them to find another SW. You charge what you need to in order to make a profit. Thats how crafters work.
All SW crafting is labor intensive, there are not factorys (but consumables and sub-components i know i know) so everything is labor intinsive.
I sell chasiss for 10CPU on bloodfin and my customres are quite happy 
I do help out people that cant pay tho, be it by buying there loot, offering a discount if they become an advertising rep for me or even if they give me resources.
Componets 20 CPU once again no compaints.
Betatoxin wrote:
The fact that shipwright has decay will kill off the weak .65 cpu guy. Don't worry.
Agreed, but again, the damage is done
Architect failed not because people sold too low. That tail wagging the dog argument does not hold up to scrutiny. People pay what they are willing to pay based on a variety of factors. Price is only one thing that effects a sale.
The architects did not "screw themselves". The developers designed a system without a proper mechanism for market renewal. Once the market saturated with products that were identical the price dropped.
Actually, commited Architects did not screw themselves over. It was the grinders, putting out products that would never decay, for pennies. After they left, the conception was "I can get that cheaper!" That situation corrected itself, albiet slowly, and on the cheap side. But it did happen.
And I agree with your other points, Beta.
Brilyn wrote:
< If I could turn around and sell those resources EASILY (especially right now) and make X cpu off of it, how the HELL is me selling it for less, spending the time to turn it intosomething,not losing money??? >
You buyResources for 10.
You convert Resources into Ship
You sell Ship for 20.
You *could* have sold Resources for 30.
You have made 10 (gross proft - cost = net gain).
That is how you did not lose money.
"Not making as much as I could have" is not the same as "losing money".
< Exactly, so why on EARTH would I sell my resources for less? >
Because my profit/loss calculation is based on reality: ie what I did pay, and what I did make.
Not what I could have made. That would be a 'fantasy' loss (ie not *really* a loss).
If you feel you can charge more, then charge more. It's NOT a loss if you don't lose money.
And yet, business modelsare build on exactly this premise. If a company can mine/produce/extract resources at insanely cheap costs, and could sell those same resources without puting any more time or effort into it at ahigh price, there is no way they are going to sell a finalized product for less than the resources would go for in the first place. That sort of business model will put them straight into Chapter 11.
You cant just factor in those two variables ("what I did pay, and what I did make" from your post above). There are other concerns, such as the time it took you to create the items (do you not believe that your time is important, and that you should be compensated for it?). In that time, not only could you have sold the raw materials, but you could also have been running missions, gathering XP for FS trees, interacting with your guildmembers, taking part in live events, flying in space, etc.
This is exactly why I no longer buff the public with my main. There's so much I'd rather be doing than spending hours sitting around, making a meesly 10k from someone who is about to make a million credits off my work. Same reason that I wouldn't take a large slicing order from a WS or AS, as they are about to pay me a grossly underrated price, and then make millions off of the end results.
Lecivius wrote:
I have not changed my prices for Buildings since I started, I'm pretty comfortable with that end of my business.
The clown selling at 65 cents a cpu for master Items is gonna drag a lot of S/W down. And since he started it, many folks are gonna expect it. That's what I mean by the Architect corrillary. There are already related posts on my forum boards saying "This price is fair, the others are gougers!". We are all one big community, all it takes is a stone thrown to cause huge ripples.
And just like Architects who have done this, they burn out and disappear. Anyone trying to follow suit will notice that there bank account hardly moves and will raise their prices or quit.
Sevardos wrote:
Lecivius wrote:
I have not changed my prices for Buildings since I started, I'm pretty comfortable with that end of my business.
The clown selling at 65 cents a cpu for master Items is gonna drag a lot of S/W down. And since he started it, many folks are gonna expect it. That's what I mean by the Architect corrillary. There are already related posts on my forum boards saying "This price is fair, the others are gougers!". We are all one big community, all it takes is a stone thrown to cause huge ripples.
And just like Architects who have done this, they burn out and disappear. Anyone trying to follow suit will notice that there bank account hardly moves and will raise their prices or quit.
00over0 wrote:
loonatik wrote:The resources are worth more than 1cpu period. If you can sale said resource for Xcpu, then to use it in your ship you need to make Xcpu or you are losing money PERIOD.
So again, the original post is dead wrong.
Message Edited by loonatik on 10-28-2004 12:57 PM
You are not losing any money if they cost you 1 cpu (or less) to obtain. You are just not making as much money as you would in another business or as much as you could if you want to raise your prices.
It seems many of you want to run mining businesses--go do it. Relatively little effort is needed, and they have a high profit margin.
I find it very funny that so many people want everyone to charge a lot. If you want to charge more, go ahead--no one's stopping you. Oh, wait--if you charge more than someone else for the same product then no one will buy from you--they will buy from someone else. Damn, this is...let's see now...this is capitalism! OMG! Let's have price fixing instead. Let's also all make sure that only a few people can fly, because of course in a game it's more fun the fewer who play.
Price fixing is not something SWG players actively engage in. Rather the market sets prices by what people are willing to pay.
Your statements about higher prices absolutely meaning you will not sell though does not stand up to scrutiny when other factors are taken into account.
Cheaper does not mean it will sell any better than expensive, it just means it is cheaper.
If price was the only factor there would be no designer label products, only no-name products and discount stores.
People will pay for
- Convenience. You ever notice how the gas stations near to freeways are more expensive than ones farther away? Convenience. If your shop is convenient, or better yet you stand in coronet and spam you will make more sales irrespective of price. Even if that shop on Lok near the shuttle port of that player city is 10% of your price you will likely out compete that shop for sales simply because you take your product to your customer. Doctors in coronet is a prime example of the value of convenience to the customer. How much do you think a doctor sitting in rori will make buffing people even at 1K a buff set?
- Supply. Supply plays a huge factor. Say you price at a below average price and sell out. You are not selling any more because you are out of product. Your customers have to go elsewhere, perhaps even paying more but they will do this, and they may not come back either once you have a reputation for empty vendors.
You can either decide to sell massive volume at low low prices for low margin, or sell for higher prices, work less, extract less resources and make the same money. Prices are what customers are willing to pay, you should charge them enough so that your stock does not fly off the shelves too fast so that you can sustain a reasonable inventory.
- Resellers. You might think you are selling to end users, but if you price at a level that allows other players to make a margin they will resell your products for a profit. This is not a bad thing IMO, but you need to consider that if your "customers" are reselling your goods at 2 or 3 times what you are selling to them that you are leaving a lot of money on the table. You are also in effect "working" for the reseller because they are taking their cut of what could be your profits. Individuals may feel differently on this issue, but it is an issue to be considered, especially if that reseller also sells their own ships.
Overall the price you should charge is the price people are willing to pay given the above variables as well as others. If you are selling out immediately you might want to raise prices to get more credits from each sale. If you are not selling at all you might want to advertise, or spam coronet to get more customers.
Overall a well placed, advertised, well stocked vendor will out perform a vendor with limited supply due to selling out at low low prices. People will pay for that ability to know a vendor will be stocked when they want to buy. Price is only one factor, and no business was ever successful just adjusting price.
Personally the more people who sell at rock bottom prices the better. Since there is decay these producers will go the way of weaponsmiths that advertise they will sell T21's for 3K a piece. You are more than welcome to become a weaponsmith and sell T21 at 3K, but history has shown you will not last long. Only a masochist would try to maintain the pace of production and the amount of rare resources required to sustain a 3K T21.
Decay changes the equation for shipwright and combined with significant resource requirements supply is going to be tight for shipwright for some time. Supply will keep prices high and the inability to factory produce most components will further keep that supply tight, even with very dedicated shipwrights.
So no problem, sell low and sell out. When you are out of resources, and out of time because you are constantly selling at 1/10 the price of other producers they will still be selling, making ten times as much and working 1/10th as much.
In the end you price based on what you feel is fair, and see if people buy, then adjust the price accordingly.
Sevardos wrote:.... and on that note, I'm getting off this train and sticking to my original comment. Pricing discussions are useless
I could not have said it better myself...5 stars....
Lecivius wrote:
Sevardos wrote:
Lecivius wrote:I have not changed my prices for Buildings since I started, I'm pretty comfortable with that end of my business.The clown selling at 65 cents a cpu for master Items is gonna drag a lot of S/W down. And since he started it, many folks are gonna expect it. That's what I mean by the Architect corrillary. There are already related posts on my forum boards saying "This price is fair, the others are gougers!". We are all one big community, all it takes is a stone thrown to cause huge ripples.And just like Architects who have done this, they burn out and disappear. Anyone trying to follow suit will notice that there bank account hardly moves and will raise their prices or quit.
Agreed, but the damage will be done by then.
The fact that shipwright has decay will kill off the weak .65 cpu guy. Don't worry.
I cannot count the number of times I have heard how some player is going to sell T21 or Composite at low low prices. They last about a weak past mastering.
Architect failed not because people sold too low. That tail wagging the dog argument does not hold up to scrutiny. People pay what they are willing to pay based on a variety of factors. Price is only one thing that effects a sale.
The architects did not "screw themselves". The developers designed a system without a proper mechanism for market renewal. Once the market saturated with products that were identical the price dropped.
Shipwright however has decay, so that means the market renews. That is why I posted on the need for decay so passionately in Beta. It market renewal through ship and component decay, not player pricing, that will ensure the long term stability of the shipwright profession.
Shipwright is far more like weapon or armorsmiths than architect. With market renewal the .65 CPU player can sell all the ships they want, and when they cannot sell any more because people are buying them out constantly (often for resale) they will either fall over from the strain, or raise prices to stay sane and stay within the resource demand.
Unlike in architect where there was a practical cap for products that made even low priced inventories move slow decay means that there is no respite. If you do not control your own inventories with appropriate pricing you will burn up period. Especially with shipwright having no final combines in factories and I have a sneaking suspicions the devs took that fact into account to allow the shipwright market to support more producers.
Keep in mind running flat out all extractors on an account will still take over a month just to make enough resources to master, and that does not even take into account whether those resources are top quality or not suitable for high end components.
Decay will mean demand stays steady over time. The requirement for top quality resources will do the rest to kill off the people that price too low.
Trust me, once market renewal through effective decay is in a system the lowballers price themselves out of business.